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Unformatted text preview: CHAPTER 7: ACCOUNTING FOR THE BUSINESS-TYPE ACTIVITIES OF STATE AND LOCAL GOVERNMENTS OUTLINE Number Topic Type/Task Status (re: 13/e) Questions: 7-1 Internal service and enterprise funds Explain New 7-2 Use of internal service funds and enterprise funds Describe New 7-3 Reason for internal service funds Explain Same 7-4 Pricing policy for ISF Describe Same 7-5 Restricted assets of enterprise funds Describe Same 7-6 Interest capitalization requirements for enterprise funds Contrast New 7-7 Cash flows in proprietary funds Contrast New 7-8 Accrued utilities revenues Describe Same 7-9 Operating and nonoperating revenues/expenses Explain New 7-10 Segment information Define Revised 7-9 Cases: 7-1 Building maintenance fund Assess Revised 7-2 Internal service fund policies Columbia, MO Assess Same 7-3 Mass transit system Evaluate Revised Exercises/Problems: 7-1 Examine the CAFR Examine Same 7-2 Various Multiple Choice Revised 7-3 Automotive Service Fund Financial Statement Revised 7-4 Central Garage ISF City of Ashville JEs and FS 7-5 Revised 7-5 Net asset classifications Journal Entries New 7-6 City of Dalton Parking Facilities Fund Financial Statements New 7-7 City of Templeton Water Utility Fund JEs and FS Same 7-8 City of Templeton (cont'd) FS and recommend Same 7-1 CHAPTER 7: ACCOUNTING FOR THE BUSINESS-TYPE ACTIVITIES OF STATE AND LOCAL GOVERNMENTS Answers to Questions 7-1. Internal service funds and enterprise funds are both proprietary funds and are presented as such in the funds financial statements. However, since the transactions of internal service funds predominately involve sales of goods or services to the General Fund and other funds that compose the governmental activities of a government, their financial balances are included in a single column of the proprietary fund financial statements. Those enterprise funds considered to be major funds are presented in separate columns of the proprietary fund financial statements, with nonmajor enterprise funds aggregated in an Other Enterprise Funds column. GASB requires that three proprietary fund financial statements be prepared: statement of revenues, expenses and changes in fund net assets; statement of net assets; and a statement of cash flows. Due to the nature of internal service funds, at the government-wide level the internal service funds balances are collapsed into the Government Activities column of the government-wide statements. Enterprise funds are considered business-type activities and are reported in the Business-type Activities column of the government-wide statements. 7.2. Internal service funds are established primarily to provide goods and services to other departments of the same government. The traditional benefit from establishing internal service funds is improved management of resources....
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This note was uploaded on 04/06/2010 for the course ACCT 100 taught by Professor Smith during the Spring '10 term at Harvard.
- Spring '10